Council Tax Benefit Localisation

Debate between Thérèse Coffey and Helen Jones

Wednesday 27th June 2012 Westminster Hall

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

It is a pleasure to serve under your chairmanship, Mr Howarth. I make heartfelt apologies to the hon. Member for Makerfield (Yvonne Fovargue) and to all hon. Members for not being here at the start of the debate. We had a bit of a train crisis meeting, so I apologise for my delay. I will make a short contribution because I am conscious that many others wish to speak.

My hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter) and I have written to the Secretary of State asking for more clarity on this matter. I hope that the Minister will be able to give us that today. If not, perhaps he could put out further notices clarifying the definition of what is “vulnerable” and what is a “vulnerable group”.

At the moment, council leaders and officers are struggling with how this system will look. Initially, the view was pessimistic, but that is often the case when there is a cut in funds, and there has to be a redistribution of the pot. In constituencies such as Suffolk Coastal, a significantly higher proportion of the population are pensioners. There are concerns that the impact of the measure on people of working age will be considerably more, given that pensioners will see no impact on their council tax benefits.

However, I say as a supportive Back Bencher that there is a challenge on us all to try to do things with the welfare state. We should see the issue as a way to encourage our local government partners to be part of the solution, which is to attract businesses and employment and to make the system a key part of encouraging people to get out to work.

[Helen Jones (Warrington North) (Lab)]

I know that, through circumstances beyond her control, the hon. Lady was not here for the early part of the debate. The point that has been made over and over again is that council tax benefit is an in-work benefit. Many of the recipients are deemed, as those who are disabled are, to be incapable of working. Therefore, the argument that councils can mitigate that by attracting more employment fails at that basic level.

[Dr Coffey]

I understand why the hon. Lady says that. [Hon. Members: “Because it is true!”] Hon. Members should allow me to develop my argument. The average wage in Suffolk is considerably lower than that of counties nearby. It is probably lower than that in Lancashire and possibly lower than that in Liverpool, where I grew up.

District councils must try to attract higher-quality, skilled businesses to our area, so that they are not solely reliant on tourism and agriculture, which traditionally pay fairly low salaries. This system is part of a mechanism to encourage local councils to attract such businesses. With more businesses in an area, there will be a greater retention of business rates, with district councils, not county councils, taking 50% of such rates. Perhaps this measure is a blunt stick to encourage local councils to do their bit and to help their residents get higher skills and higher-value employment. We may be using a blunt stick to achieve that, but the aim is to say to local councils, “You have a role to play in the economic benefits for your area, and you should not simply be a processing house for benefit claims.”

Mr Howarth, I said that my speech would be short. I have taken one intervention, and I now leave it to other hon. Members to continue the debate.